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Spain takes first steps toward airport privatisations

The Council of Ministers has just green-lighted the creation of a holding company for the country’s airports operator, Aena, opening the door for private sector investment in the country’s airports.

The Spanish government has taken its first steps toward allowing private capital to own part of the country’s airports operator, Aena, as well as individual airports, including those in Madrid and Barcelona.

At a meeting earlier today, Spain’s Council of Ministers approved the creation of Aena Aeropuertos S.A., a new holding company that will incorporate all of Aena’s assets and services, but with the ability to sell up to 49 percent of its capital to the private sector.  The government values the 49 percent at €9 billion including debt, or €2.7 billion in equity. Aena, however, is highly leveraged, carrying over €12 billion of debt.
 
Under a new law approved late last year, Aena Aeropuertos S.A. will also be able to tender individual airports to the private sector. Indeed, Prime Minister José Luis Zapatero told Parliament last December that the government plans to privatise the country’s two biggest airports – Madrid’s Barajas and Barcelona’s El Prat.
 
The two airports – which had a combined throughput in 2009 of some 75 million passengers – could be tendered to the private sector for a maximum of 40 years under Spanish law. Aena currently manages 47 airports.
 
Madrid’s Barajas is Spain’s premier airport and, thanks to a recent refurbishment carried out by the government, can now handle more than 70 million passengers per year after the authorities increased the number of runways from two to four and added a new airport terminal. Barcelona’s El Prat airport is Europe’s major traffic gateway to Latin America.

In related news, Aena launched a €2.6 million tender earlier this month to hire an advisor to help it with the upcoming privatisation process. Interested parties have been asked to submit their offers to the airport authorities by March 14.

In addition to the airport privatisations, the government is also eyeing the privatisation of air traffic control at Alicante, Valencia, Ibiza, La Palma, Lanzarote, Sevilla, Jerez, Sabadell, Cuatro Vientos, Vigo, La Coruna and Melila airports. 
 
The part-privatisation of Aena and the tenders for the Madrid and Barcelona airports are part of the Spanish government’s plans of raising over €14 billion to help cut debt at a time when Spain has been under severe pressure from the international money markets. The sale of a 30 percent stake in the country’s publicly owned lottery, worth an estimated €5 billion, is also part of its divestment strategy.